The Chancellor of the Exchequer recently announced that the purchase of any residential property between the 8thJuly 2020 and the 31st March 2021 would only incur a payment of Stamp Duty for any properties above £500,000.00.
However, these rates do not wholly apply to those people who are purchasing additional dwellings i.e. they already own one dwelling and are purchasing another for example a buy to let property or a second home.
In those circumstances higher rates of Stamp Duty brought in by the Government a couple of years ago still remain (albeit at an amended rate) and those new rates are as follows:
|Up to £500,000||3%|
|The next £425,000 (the portion from £500,001 to £925,000)||8%|
|The next £575,000 (the portion from £925,001 to £1.5 million)||13%|
|The remaining amount (the portion above £1.5 million)||15%|
There is a saving as the previous rates were:
|£40,000 up to £125,000||3%|
|over £125,000 to £250,000||5%|
|over £250,000 to £925,000||8%|
|over £925,000 to £1.5 million||13%|
|over £1.5 million||15%|
Companies buying who have a property portfolio held under a limited company or clients buying additional residential properties in their sole name will not be exempt up to £500,000 as some appear to think. However, there are savings for those now purchasing over £125,000.
Therefore, whilst the reduction is a welcome one there still is a substantial tax for those buy to let investors to think about.
Should you wish to contact Kieran Quinn at P.A.Duffy & Co Solicitors, please call our Dungannon office on 028 8772 2102. You can also contact our Dublin office on 01 533 7860 or complete a Free Online Enquiry and we will soon be in touch.